The first thing you have to remember in making an appraisal is to make it a point to be around during the appraisal. Your presence greatly helps in influencing the method positively. The more upgrades you will be able to pinpoint to the appraiser, the more accurate he or she will be able to evaluate your home’s condition.
You may look around your neighborhood and ask about comparable houses in the area and find time to visit them in advance if you have a chance to do so. Your local Department of Real Estate office (DRE) can help you out find the best appraisal company for you. Your trusted realtor can also help you in this matter since he or she knows the best appraiser around and knows a great deal about the area. It is preferable that your realtor is also around during a real estate appraisal. One of the basic steps in the home buying or
selling process is a real estate appraisal.
According to some experts, this method helps to establish the market value of a home and its likely price in a competitive and open real estate market.
Mortgage lenders such as banks and other financial firm will surely require an appraisal if you are going to use a property to secure a loan since they want to make sure that the property will sell at the amount it will lend you. That is a no brainer and this method is also done by investors as well to be able to loan money from banks and other financial institution.
The methods of a real estate appraisal include the following;
- Banks and other financial firm will get full information on the subject property, along with side-by-side comparisons of three similar houses.
- They will also make an evaluation of the overall real estate market of the area.
- An estimate of the average sales time of the home.
- Statements about issues that the appraiser feels could negatively affect the home value, such as poor access to the property.
- Banks will also take note about possible serious problems inside the house like the ceiling, flooring and even the foundation of the house.
- Banks will also investigate the type of community or neighborhood the home belongs.
Experts added that in appraising residential properties, there are two techniques to be used, these are the Sales
Comparison technique and the Cost technique. In the first
technique, the appraiser makes an estimate of the home’s market value by comparing similar houses that have sold in the area. The homes used are known as comparables or comps.
Because no two homes are the same, the appraiser should compare the subject home with the comps, make adjustments to make the features nearer to the subject home. The result is a figure that show what each comp would have sold if it had the same components as the subject home.
The other one, the so called cost technique, the appraiser estimates the amount of the replacement of the structure if it were destroyed.
Although some areas do not require license or certification, a licensed or certified appraiser should do a real estate appraisal. Always keep in mind that appraisals are very subjective, so they are open to manipulation. A real estate appraisal is very important, particularly if you want to sell your home. Maximize the value of your property by taking an active part in the appraisal process.
Remember that appraisers are not robots, they are not familiar with every aspects of your home needed to be appraised. So, better help your appraiser understand your property more.
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